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Annmarie Fertoli : Democrats are struggling to unify their party as they debate key spending proposals.
Eliza Collins : And so now we are finally starting to see a little bit of splintering and it’s the usual splintering that parties have. The further flank, the left flank and the centrist Democrats don’t agree on everything.
Annmarie Fertoli : And what’s causing a rally in oil prices. Plus why Halloween is scaring retailers. It’s Monday, October 11th. I’m Annmarie Fertoli for The Wall Street Journal. This is the PM edition of What’s News, the top headlines and business stories that moved the world today.
The price of US crude oil closed above $80 a barrel today for the first time since late 2014. The hike in recent weeks comes amid a worldwide shortage of natural gas, which has stoked fears of a spillover into the oil market. Since the end of last October, the price of has risen 125%. It’s also surpassing the price of other commodities and is on track to outpace copper this year, by the largest amount since 2002. As oil prices rallied today, US stocks fell. All three major indexes ended the day down.
Former giant, Merck and its partner, Ridgeback Biotherapeutics are asking the FDA to authorize their COVID-19 pill. Data from a late stage study shows the antiviral drug cut the risk of hospitalization and death by about half in those with mild to moderate symptoms. If authorized, the pill would be the first oral treatment for COVID-19, filling a big need for a home medication to avoid hospitalization. Merck said it would make the pill available globally and has licensing agreements with generic drug makers to ensure its availability to low income countries.
And Chinese property developer, Modern Land, has asked investors for permission to defer repaying a 250 million bond that’s due later this month. It’s the latest sign of financial stress that has gripped Chinese real estate developer Evergrand And many of its rivals. Modern Land is seeking three month extension and said its Chairman and President would together provide the equivalent of $124 million in loans to shore up the group’s finances. Shares of Modern Land have fallen more than 40% this year.
Coming up, can Democratic progressives and centrists find common ground on Capitol Hill?
Democrats in Washington are trying to work out an agreement on a $3.5 trillion spending bill that includes funding for everything from education to healthcare, to climate change. And they’re not just getting pushback from Republicans. Democratic senators, Joe Manchin of West Virginia and Kyrsten Sinema of Arizona are centrists who want to pair back the package and the price tag. In an effort to reach an agreement, President Biden has been floating a roughly $2 trillion funding compromise. But progressive heavyweight, Vermont Senator, Bernie Sanders says he’s standing firm on 3.5 trillion. It’s a sign of the challenges Biden faces unifying the party as they seek to push key pieces of Biden’s legislative agenda through Congress. Joining me now is Wall Street Journal politics reporter, Eliza Collins. Hi Eliza. Thanks for being here.
Eliza Collins : Of course. Happy to.
Annmarie Fertoli : Eliza before we get into specific proposals can you talk more broadly about the factions we’re seeing within the Democratic party?
Eliza Collins : Yes. so it’s been really interesting because Democrats came into this year really united, they united behind Biden, which is something we didn’t actually know if it would happen. They did. They came in and they were united on Coronavirus relief legislation. And so now we are finally starting to see a little bit of splintering and it’s the usual splintering that parties have. The further flank, the left flank and the centrist Democrats don’t agree on everything. What’s interesting here is President Biden has actually positioned himself kind of in the middle of both of those, even though he used to be known as more of a centrist. So you’ve got the progressive Democrats looking for a big, bold as much action as possible. The centrists who are the ones who actually have to win in red and purple districts and states are looking for less, or for more measured, more means tested, different kinds of programs in that way. And that goes in pretty much all the legislation that they’re talking about.
Annmarie Fertoli : You spoke on the phone recently with Vermont Senator, Bernie Sanders, a self described Democratic socialist, and he has long been championing a broader, social safety net, but that hasn’t always been a popular idea on the Hill. What can you tell us about what’s shifted recently?
Eliza Collins : Yes. So Sanders is pretty much seen as the leader of the progressive movement. There have been new liberal Democrats who have come behind him, Congresswoman Ocasio-Cortez and others. But he really still is seen as the leader of the progressives and he’s been in Congress for decades, and his ideas did not always catch on. When they really started to gain steam was in his two runs for president. So the dial has moved to the left. And so here’s what Bernie Sanders had to say about that.
Bernie Sanders: By getting out there and by finding that millions and millions of people (inaudible) the progressive agenda, and that you had wonderful, young people elected to Congress on that agenda, being elected to state legislatures and city councils on that agenda, made folks here in Washington take a look and say, well, it’s the right thing to do. And it’s good politics. Let’s go forward.
Eliza Collins : Yeah. So Sanders really did change the way Democrats operate, a whole new class of generally younger, more liberal lawmakers have come in to Congress. They’ve come into state houses and activists have just become sort of more bold in what they’re demanding and there’s no denying that the party has shifted to the left. Not all the way where Sanders is, but it has moved to the left from 2016 when Hillary Clinton was a nominee.
Annmarie Fertoli : And that is something that’s put progressives more at odds with the more centrist wing of the party, as we saw with the delay of the infrastructure vote in the House at the end of last month.
Eliza Collins : So in the Senate, a bipartisan group of senators agreed on a roughly 1 trillion hard infrastructure package. So roads, bridges, traditional infrastructure. They pass that bill and then we’re going to move onto this larger social policy and climate bill. Right now it’s estimated at $3.5 trillion though it’ll probably have to come down. That move to the House where Democrats also have a majority, but more progressive influence. And those House members said that they did not want to pass the infrastructure bill and then wait on the larger package because frankly they didn’t trust that the centrists whose priority was the infrastructure bill, they didn’t trust that if that passed, they would agree to pass the larger bill. And they’re waiting to see what comes out of this larger bill before they agree to pass the infrastructure bill.
Now there’s pretty wide agreement that they’ll pass the infrastructure bill as well. They don’t oppose it, but they just think it’s much too small. So they want to see this larger package move as well. And the larger package right now is up for debate. We have someone like Senator Sanders who says it’s got to be $3.5 trillion. That’s down from his campaign promise. He promised 16 trillion for climate alone. In Congress, he proposed 6 trillion. They agreed on 3.5, but there are centrist Democrats, Joe Manchin, Kyrsten Sinema, who say it should look a lot smaller than that. Manchin has floated a 1.5 trillion package. President Biden’s lately been floating a 2 trillion to sort of meet in the middle, but both sides at this moment are digging in their heels. So we’ll have to see what that package looks like. And once that passes, if that passes, then the House will pass the infrastructure bill.
Annmarie Fertoli : So as we’ve been seeing, Democrats are working to unite the party, and those are conversations we’re likely to continue seeing this week and in the coming weeks as they try to push the president’s legislative agenda through Congress. Can you tell us more about what we should expect?
Eliza Collins : So I think we started to really see this last week. So the President and Democratic leadership have been negotiating with Sinema and Manchin because those are the two basically holdouts. We’ve been seeing that. Last week, the President had a series of meetings with different factions. So he had a meeting with progressives, he had a meeting with centrists, and was really in those meetings, starting to float this idea. Let’s unite around $2 trillion. It might not be as big as you want, or it might be a little bigger than you’re comfortable with, depending who he was talking to.
But his message is we need to unite. They’re going into the midterms. They have an uphill battle, especially in the House. Just Democrats or both parties when someone is in power, they tend to lose in the first midterm election. And so Democrats are very aware of that. The Senate is split 50-50 right now so it really could go either way. So Biden and the Democrats say they have to pass their campaign promises, and you’re just going to see that message they’ll continue to meet. The President is going to continue to try to get people onto the same page.
Annmarie Fertoli : That’s Wall Street Journal politics reporter Eliza Collins. Thanks for joining me, Eliza.
Eliza Collins : Thank you.
Annmarie Fertoli : And finally, Halloween is just around the corner and it’s already giving some retailers and customers a real scare. Shelves are bare because supply chain bottlenecks have delayed shipments of costumes and decor. Some retailers are splurging on air freight to get inventory in time. And some smaller shops are buying up vintage decorations. But our reporter Alex Janin says it’s also forcing customers to get creative.
Alex Janin: So I spoke with (Amy Cobar). She is a mother of six in Ohio. She loves Halloween. She actually bought her first Halloween decoration this year in July. And when she went back in August, it was sold out. So she has gotten creative with some of the other decorations that she couldn’t find that she wanted to. For example, she bought a whole bunch of beef netting, which is typically used in the meat packing industry for product, and she used it to make fake spider webs in her yard.
Annmarie Fertoli : And that’s What’s News for this Monday afternoon. We’ll be back tomorrow morning. If you like our show, please rate and review us. I’m Annmarie Fertoli for The Wall Street Journal.